Powell reaffirms Fed’s hawkish stance

Today's news headlines:

‘Powell reiterates half-point hikes are likely in June and July’. Federal Reserve Chair Jerome Powell repeated claims during a radio interview that the central bank is likely to raise interest rates by 50 basis points in June and July if the economy performs as expected. While a 75-basis point hike remains a move that the Fed aren’t ‘actively considering’, Powell added ‘if things come in worse than expected, then we’re prepared to do more’. The interview was wrapped up with Powell stating his thinking in five words—‘get inflation back under control’. (Bloomberg)

‘Sunak says Brexit deal causing harm, urges EU to be flexible’. UK Chancellor Rishi Sunak has urged the European Union to be flexible as the UK government weighs up scrapping parts of the Brexit deal relating to Northern Ireland. Political instability has risen in recent weeks, with the pro-UK Democratic Unionist Party refusing to appoint new ministers if checks on goods crossing the Irish Sea border are to remain. (Bloomberg)


Today

European and US equity futures were higher along with government bond yields this morning, while safe-haven currencies—US Dollar and Japanese Yen—pulled back following yesterday’s gains. Oil and energy prices climbed, with Brent Crude trading around $108 a barrel.

Events

French Consumer Price Index YoY (Apr): 4.8% (est. 4.8%)
US University of Michigan Sentiment Surveys (May): 3:00PM
Russian Consumer Price Index YoY (Apr): 5:00PM

Interbank rates:

​​​​​​​
GBP/USD – 1.2225
GBP/EUR – 1.1750
EUR/USD – 1.0404
USD/CAD – 1.3000

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